GBP/USD Price Forecast – British pound rallies during early Tuesday session
The British pound has rallied significantly during the trading session on Tuesday, reaching towards the vital 1.32 level, an area that has been important more than once, and should continue to be so. I think that the market will continue to find sellers in that region, but if we do break above there, it’s likely that the next target will be 1.33 above. The market continues to be very noisy, but at the end of the day it certainly is a market that will continue to move upon headlines and fear more than anything else.
We have made a “higher low” on the hourly chart, but I think that it is still early to consider that the market may turn back around longer-term. I believe that the US dollar will probably continue to strengthen overall as a bit of a safety trade, as market participants buy more treasuries. Beyond that, there is a certain amount of unknown when it comes to the United Kingdom, so that of course will keep some traders away.
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I suspect that with the Independence Day holiday in the United States today, it’s likely that we will see a lot of noise, but very little beyond that unless of course a liquid conditions exacerbate some type of shock coming out of the headlines. Overall, I would anticipate very quiet and back and forth trading in this general vicinity.